US stock futures are holding steady this morning ahead of a busy calendar of data starting at 8:30am. Initial and continuing jobless claims will give clues about the pace of the jobs recovery, while January CPI data will shed light on inflation pressures. At 10am, the Philadelphia Fed Survery and Leading Indicators will be released, and Fed Chairman Ben Bernanke will testify before the Senate Banking Committee on Dodd-Frank reforms along with SEC Chair Mary Schapiro, FDIC Chair Sheila Bair, and CFTC Chair Gary Gensler.
Yesterday stocks opened and drifted higher, buoyed in the afternoon by some of the FOMC’s most positive comments to date, in the Fed minutes, about the recovery.
Oil stocks enjoyed another push higher, led by our favorite in the group, Schlumberger Limited (SLB). The Oil Service HOLDRs ETF (OIH) also broke out to new highs after getting turned down at resistance the day before. JP Morgan Chase & Co. (JPM) led the banks again with a monster day, briefly poking its head through 52-week highs from back in March before dipping back below.
For more market and stock commentary see Scott Redler’s daily morning Price Point sheet and watch his Morning Call Show below.
Apple Getting Hit on Steve Jobs Concerns
After opening at and then extending to new highs yesterday, Apple Inc. (AAPL) was trading down 3% in premarket this morning after reports that Steve Jobs has been seen visiting a cancer treatment center in California. However, the stock has recovered most of those losses in the last two hours. Apple is a strong company that is more than just one brilliant man, and we already knew he was having health problems, so I’m not sure what the big stink is about overnight. Anyone who is investing in Apple under the assumption that Steve Jobs will live forever is delusional.
Watching Intel
Last week we highlighted a bullish pattern in Intel Corporation (INTC) a former high flying tech stock that is now a slow-moving value type of play. The stock has not yet gotten the breakout we were looking for, but the pattern is intact as Intel has continued to trade in an upper consolidation. The chip maker had a strong day yesterday and surged back into the upper end of that range, so we will be watching to see if it can get some momentum today.
First Solar Holding Up Well
The solar sector is a bit iffy fundamentally long-term, but often provides great technical trades when it wakes up. The undoubted leader in the group is First Solar, Inc. (FSLR), which broke out with a potent igniting bar last Friday. The stock looked to match that bar with another wide range green bar on Monday, but gave back nearly half of those gains in the afternoon. The rest of the week, however, the stock has held up well and consolidated into a mini-wedge pattern near the highs. Watch how it acts above yesterday’s high for a potential quick trade.
Wynn Also Consolidating After Breakout
Just like FSLR is the clear leader among the solars, Wynn Resorts Limited (WYNN) is the unquestioned cream of the crop among the casinos. Las Vegas Sands Corp. (LVS) had a great long-term wedge pattern that got us excited about the stock into earnings, but the company’s report disappointed. I traded out my LVS position after its earnings report in favor of Wynn because I still wanted to have exposure to casinos. Wynn, on the other hand, was acting strong, not indecisive, into earnings, reported a blowout quarter and gained more than 8% following its report.
Over the last three days, WYNN has consolidated in a tight range in the very upper part of Friday’s breakout, signaling that it wants to go higher after some rest. There are plenty of analyst price targets in the $140 area, and we expect Wynn to get there as Macau revenues continue to grow at a remarkable pace. Active technical traders may look to take some profits along the way, but the measured move should see WYNN reach $140.
Walter Energy Looking to Get Back to Highs
Walter Energy Inc. (WLT) is another stock we feel has good upside fundamentally this year. The stock doubled in 2010, but so far in 2011 the stock has pulled in and held a mini-downtrend. Right now, WLT is set to open right at that lower trendline. We feel that technically this stock has an outstanding set-up for a move first back to previous highs at $140, then eventually a breakout.
Whole Foods Consolidating After Earnings
Whole Foods Market, Inc. (WFMI) sure does have terrific food, but is not a stock active traders watch often. Recent price action, however, has it looking like a compelling long, says Marc Sperling of T3Live.com. The stock jumped 11% the day after earnings last week, and has held that gap. Yesterday the stock got a nice push higher, and Sperling says he will be watching the stock for another move. In this uptrending market, playing strong earnings stocks after continuation moves has been a successful strategy.
*DISCLOSURE: Scott Redler is long INTC; Short SPY. John Darsie is long WYNN, AAPL, JPM, SLB.
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